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When Government Was the Solution

By Jean Edward Smith May 21, 2007 6:14 pmMay 21, 2007 6:14 pm

For more than a generation, Americans have been told that government is the problem, not the solution. The mantra can be traced back to Barry Goldwater’s presidential bid in 1964. It provided the mind-set for the Reagan administration, and it has come to ultimate fruition during the presidency of George W. Bush.
On college campuses and at think tanks across the country, libertarian scholars stoke the urge to eliminate government from our lives. This thinking has led to the privatization of vital government functions such as the care of disabled veterans, the appointment to regulatory commissions of members at odds with the regulations they are sworn to enforce, the refusal of the Environmental Protection Agency to protect the environment, and the surrender of the government’s management of military operations to profit-seeking contractors.

A look back at Franklin D. Roosevelt’s presidency shows how differently Americans once viewed the government’s role, how much more optimistic they were and how much more they trusted the president.

F.D.R., like his cousin Theodore, saw government in positive terms. In 1912, speaking in Troy, N.Y., F.D.R. warned of the dangers of excessive individualism. The liberty of the individual must be harnessed for the benefit of the community, said Roosevelt. “Don’t call it regulation. People will hold up their hands in horror and say ‘un-American.’ Call it ‘cooperation.’ ”

When F.D.R. took office in 1933, one third of the nation was unemployed. Agriculture was destitute, factories were idle, businesses were closing their doors, and the banking system teetered on the brink of collapse. Violence lay just beneath the surface.

Roosevelt seized the opportunity. He galvanized the nation with an inaugural address that few will ever forget (“The only thing we have to fear is fear itself.”), closed the nation’s banks to restore depositor confidence and initiated a flurry of legislative proposals to put the country back on its feet. Sound banks were quickly reopened, weak ones were consolidated and, despite cries on the left for nationalization, the banking system was preserved.

Roosevelt had no master plan for recovery but responded pragmatically. Some initiatives, such as the Civilian Conservation Corps, which employed young men to reclaim the nation’s natural resources, were pure F.D.R. Others, such as the National Industrial Recovery Act, were Congressionally inspired. But for the first time in American history, government became an active participant in the country’s economic life.

After saving the banks, Roosevelt turned to agriculture. In Iowa, a bushel of corn was selling for less than a package of chewing gum. Crops rotted unharvested in the fields, and 46 percent of the nation’s farms faced foreclosure.

The New Deal responded with acreage allotments, price supports and the Farm Credit Administration. Farm mortgages were refinanced and production credit provided at low interest rates. A network of county agents, established under the Agricultural Adjustment Act, brought soil testing and the latest scientific advances to every county in the country.

The urban housing market was in equal disarray. Almost half of the nation’s homeowners could not make their mortgage payments, and new home construction was at a standstill. Roosevelt responded with the Home Owners’ Loan Corporation. Mortgages were refinanced. Distressed home owners were provided money for taxes and repairs. And new loan criteria, longer amortization periods and low interest rates made home ownership more widely affordable, also for the first time in American history.

The Glass-Steagall Banking Act, passed in 1933, authorized the Federal Reserve to set interest rates and established the Federal Deposit Insurance Corporation to insure individual bank deposits. No measure has had a greater impact on American lives or provided greater security for the average citizen.

The Tennessee Valley Authority, also established in 1933, brought cheap electric power and economic development to one of the most poverty-stricken regions of the country. Rural electrification, which we take for granted today, was virtually unknown when Roosevelt took office. Only about one in 10 American farms had electricity. In Mississippi, fewer than 1 in 100 did. The Rural Electrification Administration, which F.D.R. established by executive order in 1935, brought electric power to the countryside, aided by the construction of massive hydroelectric dams, not only on the Tennessee River system, but on the Columbia, Colorado and Missouri rivers as well.

To combat fraud in the securities industry, Roosevelt oversaw passage of the Truth in Securities Act, and then in 1934 established the Securities and Exchange Commission. As its first head he chose Joseph P. Kennedy. “Set a thief to catch a thief,” he joked afterward.

By overwhelming majorities, Congress passed laws establishing labor’s right to bargain collectively and the authority of the federal government to regulate hours and working conditions and to set minimum wages.

An alphabet soup of public works agencies — the C.W.A. (Civil Works Administration), the W.P.A. (Works Progress Administration) and the P.W.A. (Public Works Administration) — not only provided jobs, but restored the nation’s neglected infrastructure. Between 1933 and 1937, the federal government constructed more than half a million miles of highways and secondary roads, 5,900 schools, 2,500 hospitals, 8,000 parks, 13,000 playgrounds and 1,000 regional airports. Cultural projects employed and stimulated a generation of artists and writers, including such luminaries as Willem de Kooning, Jackson Pollock, John Cheever and Richard Wright.

Roosevelt saw Social Security, enacted in 1935, as the centerpiece of the New Deal. “If our Federal Government was established … ‘to promote the general welfare,’ ” said F.D.R., “it is our plain duty to provide for that security upon which welfare depends.”

For the first time, the government assumed responsibility for unemployment compensation, old-age and survivor benefits, as well as aid to dependent children and the handicapped. At F.D.R.’s insistence, Social Security was self-funding – supported by contributions paid jointly by employers and employees. (In most industrialized countries, the government provides the major funding for pension plans.) “Those taxes are in there,” Roosevelt said later, “so that no damn politician can ever scrap my Social Security program.”

The government’s positive role did not end when the New Deal lost effective control of Congress in 1938. Neither Wendell Willkie, the G.O.P. standard-bearer in 1940, nor Thomas E. Dewey, in 1944 and ’48, advocated turning back the clock.

The G.I. Bill of Rights, adopted unanimously by both houses of Congress in 1944, provided massive government funding to provide university and vocational training for returning veterans. The G.I. Bill changed the face of higher education by making universities accessible to virtually every American.

The Eisenhower administration continued to see government in positive terms. President Eisenhower added 15 million low-income wage earners to Social Security, and he launched the interstate highway system – which also was self-funding, through additional gasoline taxes. Only the federal government could have organized so vast an undertaking, the benefits of which continue to accrue.

The ideological obsession of the Bush administration to diminish the role of government has served the country badly. But perhaps this government’s demonstrated inability to improve the lives of ordinary Americans will ensure that future efforts to “repeal the New Deal” are not successful.

We have perhaps reached the apotheosis of “corporate welfare through Big Government;” the U.S. treasury is looted in the name of spurious foreign policy; anonymous “investor” syndicates loot “public” companies after taking them “private;” failed banks and other large companies are bailed out by taxpayers; “laissez-faire capitalism” trumps the Kapitalism of Karl Marx in viciousness, because it is virulently speculative AND endlessly subsidized by Big Government; and “the people” are but pawns in this ruthless rich man’s game.

I am really outraged by the faith-based government and its assault on science. We need the FDA to work. We need the EPA to work. We need FEMA to work. Maybe previous generations trusted the president because they had a trustworthy president. We have one who started by stealing the election.

It should be added that the GI Bill (which the American Legion also promoted vigorously) has been the most successful of federal programs in returning tax dollars to the government. The second most successful has been Headstart, which then-congressman Cheney voted against. For Headstart, the figures do not incorporate the losses due to crime that could be anticipated were the program not in existence. Having worked in Upward Bound and the National Endowment for the Humanities Seminar Program for Teachers (for five summers each) I can say that well-constructed, intelligently run federal programs work brilliantly. The outcroppings of the “Great Society” continue to exist in spite of years of know-nothing attacks.

In a strange way, Jimmy Carter opened the door to anti-government government. He was the first to run as an “outsider” and based much of his campaign on distrust of Government and beltway mentality.

Of course, George W. Bush has increased mistrust of Government by bringing to most agencies persons who are anti-government and see the government agencies as a means to enrich the special interests they represent, something to be exploited rather than create policies for the greater good. His cyncial cronyism and exploitation of government has succeeded in undermining public trust in government and its ability to solve the growing national and international problems. It will take decades to repair this damage!

It’s too little to say that Bush wantds to “diminish the role of government.” He wants to discredit the idea of good, upright, cost-effective government, while making it more costly and less effective. He seeks to discourage people from asking for quality government in the first place. He just wants us to pay through the nose for mediocrity.

The irony of this is that the south and the west were developed by “big government”. Without water/electrification projects like TVA, rural electrification and other similar projects pushed throughout Texas and the west by Sam Rayburn, and Lyndon Johnson as well as many other “big government Democrats” the south and west of today would not exist. Without TVA there would be no air conditioning, and then who would want to live in the south? Los Angelas could not exist without the water projects of the last century. Cheap government subsidized power devloped the Pacific Northwest. If not for massive government intervention todays most ardent opponents of “big government” would not now have the wealth and influence they are presently using to destroy this country.

The Republicans argue that government is inefficient and evil, and they have done their damnedest to make it so. Cronyism and placing incompetents or loyalists in positions of oversight have made their prophecy self-fulfilling.

Foreign, domestic, military, monetary, and environmental policies have all been hijacked in order to foster naked, unchecked capitalism and to provide corporate welfare. This administration’s actions favor big business and the Republican party to the detriment of the average citizen and the national good, and we will be lucky to survive it as a nation.

Isn’t there a docment somewhere that says something about government “of the People, by the People and for the People?” Doesn’t that indicate that our form of government is actually meant to help people? It worked pretty well under FDR, even during a world war. Some of the great works of that era are still standing, still functioning, in fact.

If government was able to accomplish so much under an administration that actually believed in the “of, by and for the People” principle, why wouldn’t it work again?

Of course we’d have to stop electing (or allowing the selection of) people like George W. Bush to office and we’d have to give the Democrats an injection of the bony matter that makes up a human spine so they would stop listening to the name-calling of regressive Republicans but all that could happen. Couldn’t it?

I graduated from Stanford University 50 years ago this month and I have never forgotten learning then that John Stuart Mill said the purpose of government is to do for the people collectively those things they cannot do for themselves individually. With that in mind it is easy to measure the accomplishments of any government regardless of what base of achievements it starts from. I would give our present government a zero when it comes to the Millsian purpose.

I am 84 years old brought up by a single working mother. After WWII I attended law school on the G.I.Bill. We would not have been able to buy our first house but for the help of our government. I have been there and done that.
Don’t forget the Good Neighbor Policy, a truly American foreign policy by which we made friends around the world, not enemies. Government is for the People, not the industrial-military complex. We the People need friends starting with our own government.

The record of waste and corruption that privatization has provided dos not not speak well for the libertarian agenda. Certainly, there has been government corruption as well but that occurs most spectacularly in the connections between government agents and private contractors. Many of us who lived through the era before Richard Nixon find ourselves living in an unrecognizable country.

Great column, but you didn’t have to go all the way back to the New Deal to recall a time when government was seen as useful for social change. JFK’s New Frontier and Johnson’s Great Society come to mind. Remember when the Peace Corps and Vista were considered the place to be? Remember Michael Harrington’s 1964 book “Poverty in America,” and the attendant belief that government should and could address the issue? It was quite interesting during 911 how one you almost feel a sea change as people looked again to government for help. The contributions of government are so in our lives that we have discounted them and indulge ourselves in believing we don’t need government.

The health care mess is a notorious example of why governmental involvement is desperately needed. That 40 million people in the richest country on earth have no health insurance because they cannot afford it is a national disgrace. As poor Americans get poorer and rich Americans get richer (and even the middle class is feeling the squeeze) there will be no satisfactory solution to providing universal health care without the involvement of the Federal government. It really comes down to reversing the decades-old tendency toward the concentration of wealth among the lucky few. It will take governmental action to improve the distribution of wealth among all Americans. This is not a new idea–it’s what the income tax, the New Deal, the GI bill, Headstart and many other Federal programs did (and some still do). When will American voters finally require the federal government to take action on the health care scandal?

Mr. Coursen is right on wih regard to to the number of successful federal programs that benefit all of us in very significant ways. I applaud his working on so many of these programs in their worderful implementation. With regards to his statement of the vigorous promotion of the GI Bill by the American Legion, my recollection was that the Legion opposed the GI Bill, prefering instead a universal veteran’s bonus.

As I read Jean Edward Smith’s article of 21 May, I couldn’t help thinking about FDR, a man who truly came to greatness in the face of seemingly insurmountable issues…and how the Bushies pale in comparison.

Most of my conservative friends who think “government is the problem” really don’t know history, so have nothing to base their opinions on. This article is a welcome glance at what liberal thought and actions have done for our country. If not for the programs initiated by FDR, we might have ended up a 3rd world country.

What concerns me is how bad things had to get before it was politically feasible to get these programs through. Are we going to get to 30% unemployment (or more likely, 30% of the population without any medical insurance) before our attitudes about government change?

Something must be said for regulation. The SEC slept during the Enron Dot Con Telecom era. Look what happened. FERC was a co conspirator in stealing during California’s bogus energy crisis. Now oligopolies game refinery capacity when they are not pointing to high crude prices bolstered by government purchases. It was clearly time to eliminate passenger airline and some transporation regulation – technology and competition demanded it. Regrettably, that successful template has been misapplied to other sectors of the economy. In some cases Bush uses or directs regulators to out right steal.

In the past, the government supplied workable solutions to many of the problems faced by a huge majority of the population, based on the full consent of the people.

This approach to problem solving only began to have it’s own problems, inefficiency and waste, when corporations found a way to cash in on these programs. They found the programs an easy source of cash and spent as much of their resources as possible, delivering as little as they possibly could. The medical insurance industry, today, is a perfect example of this.

The conservative movement in this country has done little to reduce the size of any program (unless, of course, it directly benefits the American people) and has in fact promoted even greater waste and inefficiency by severely reducing oversight and regulation of these programs.

Corporate welfare appears to be a key plank of the Conservatives; notice the additional outsourcing of government programs with absolutely zero accountability. So the Veteran’s Hospital is a hovel, swarming with rats; somehow we are suppose to believe that we are all better off and that Corporations have things well under control.

I am constantly amazed by the garbage coming out of most Conservative, and some Libertarian think-tanks. Clearly they only serve their corporate paymasters since none of their recommendations benefit, in any way, shape, or form, a huge majority of Americans. These “great thinkers” apparently refuse to believe that the American people have any right to determine for themselves, which programs their government can and should establish for the benefit of all the American People.

Thanks to DrNova, Farley, and Coursen. Add to your list the concerted efforts by the Bush administration and other who are working hard to destroy the Department of Education. How many profit-making private schools have sprung up across the country? My personal experience with some of them has shown how totally incapable they are in managing schools with their so-called application of business models. Draw out of the public schools those who now may use vouchers (public money) to attend their ideology-based alternatives, including some charter schools! Why not. Give faith-based agencies public money so they can proselitize those they help. The bushwackers realize how much money may be gotten in the school biz. One need only look at the tragedy of Haliburton in Iraq to find the real motive for this government’s behavior: bilk the public, steal our tax dollars, and then run. Government’s opposite is anarchy as far as I’m concerned. Without it, those with the guns and money will take control and we might as well forget democracy. And here we are telling the world we will impose democracy elsewhere when we don’t seem to be doing too well with it at home at the moment.

The flip side of the neoliberal anti-government position is, of course, the neoconservative opposition to grass-roots social movements. Growing up in the 60s and 70s government and grass-roots movements were largely presented as the solutions to problems rather than the problems themselves. The fundamental commitment of the new left — for all its faults — was to democratize the state, science, the family, sexuality, nature and culture.

Part of the unintended contradiction of New Deal and Great Society programs, has been that their Progressivism embraces an expert-led rather than grass-roots-driven approach to policy formation and implementation… a vision of leadership and bureacracy that, despite fundamental differences in content, formally parallels that of the New Right in both its economic and cultural moments.

Since all of the postings are in support of the article I thought I’d be the lone voice in the wilderness to pose some opposing views. While FDR’s programs have survived, many have outlived their usefulness but are politically untouchable (TVA for example). It should also be noted that while FDR gets credit for doing something (to his credit I might add) reasonable people can debate the effectiveness of his actions. It took a massive military build up and victory in the war, which left us as the main industrial country to supply the world with products for a rebuilding world. Even the most recent examples of the Great Society have dubious results. Head start is a positive while the isolation of the poor into the projects was a failure. This piece is way too glowing on the role of big government and much too harsh on the role of limited government. There is a role for big government projects and there is a role to limit the scope of government. Neither is absolutely right or absolutely wrong.

Maybe we should direct our government to build the gas refineries the oil companies say they can’t because it is too expensive. We could take the money from the Iraq war budget of $8 Billion a month. We then could build ethenol refineries that oil companies will not build because they say that ethenol costs more energy to make than you get out of it. That can be true if you use coal fired, natural gas fired, or oil fired heat to “cook” the ethenol. The part of that story the oil companies don’t tell us is that we already use a system that superheats steam turbines that produce millions of kilowatts of electricity and drives many of our Navy ships including most aircraft carriers for over a quarter century without even refueling from a fuel source not much bigger than a basketball. It is called Nuclear Power. The government could make superheated steam to cook the ethenol mixture and we would not need any imported oil. The Arabs would be free to use their oil to take baths in and the oil companies would no longer be relevant. But our leaders would not want that because that would mean Americans would be buying fuel for their cars for less than a dollar a gallon. Isn’t that ridiculous?

There’s strong evidence that the Great Depression was caused largely by poor monetary policy. It was ended by this country’s entry into World War II and the vast production the war required. FDR’s programs were little more than feel-good policies that delayed the US’s recovery. Economic growth is and always has been fueled by the private market, and excessive regulation causes much more harm than good.